Category: The Chief Economist’s Note

Do policymakers have sufficient ammunition to fight the next economic downturn? It’s a question that’s vexing economists – and at first sight the answer appears to be “no”. After all, on the fiscal side, public debt ratios in most developed economies are still well above their pre-2008 levels and in some cases (notably the US) … Continue reading “Policymakers still have ammunition – but will they use it?”

Will the recent weakness in a broad swathe of economic data be a flash in the pan or does it herald the start of a new global downturn? The answer is likely to depend in part on what happens to financial conditions. Financial conditions is a somewhat esoteric term to describe how the prices of … Continue reading “If you only watch one chart, make sure it’s this one”

With concerns about the outlook for the global economy starting to build, thoughts are turning to what policymakers might do to support growth. A common refrain is that the current low level of real interest rates and high levels of public debt limit the room for conventional monetary and fiscal stimulus. That’s true but, as … Continue reading “Time for policymakers outside the US to step up to the plate”

Annual gatherings, like those in Davos last week, tend to produce little in the way of meaningful policy shifts, but they can be a useful way of gauging the mood about the global economy. This year it was decidedly gloomy. The IMF grabbed the headlines by pulling down its forecast for global GDP growth in … Continue reading “As the data collapse, what might we be missing?”

Populist governments have already challenged several areas of received economic wisdom, so it was perhaps only a matter of time before they turned their focus to central banks. As ever, President Trump has grabbed most of the headlines by griping at the Fed for tightening policy. But Italy has put pressure on the ECB to … Continue reading “In defence of central banks”

The market sell-off in the final weeks of last year was driven in part by fears about an over-zealous Fed, but also by growing concerns about the health of China’s economy. So is it time to worry about China again? Part of the problem is that a lack of reliable data on China’s economy means … Continue reading “China’s role in the coming global slowdown”

In my note last week I sketched out a comparatively bright outlook for the global economy over the long run. In contrast, the economic outlook for next year is rather more challenging – and this is likely to have significant implications for financial markets. We published our key calls for 2019 last week – you … Continue reading “What to watch for in 2019”

The conventional view of the long-term prospects for the global economy can be summarised as: EMs good, DMs bad. Like most things, however, we suspect that the conventional view is likely to be wrong. Last week we published our first Long Term Global Economic Outlook, which sets out forecasts for the major developed and emerging … Continue reading “Taking the long view”

The sharp fall in oil prices over the past month or so has led to several questions about the implications for the global economy. We’ve written lots on this subject, including how central banks might respond and why the major oil producers are now better positioned to weather a fall in prices than they were … Continue reading “The economic implications of the collapse in global oil prices”

While US readers were settling in for Thanksgiving dinners, those of us on the other side of the pond were left to pick over the remains of a Brexit deal that looks dead on arrival. Our UK economists have covered the various twists and turns in detail and copies of the various publications are available … Continue reading “Picking through the Brexit shambles”